DETROIT – Chief Executive Officer Fritz Henderson was explaining to a gathering of reporters that customers are the new top priority at the New General Motors just as I was flying back from the Kia Forte Koup first drive in Seoul, South Korea. “At the new GM, we’re making the customer the center of everything we do,” he told the press corps. Had I made Henderson’s press conference, I might have asked what GM’s priority was for its first 100 years. The answer, I’m sure, is “profits,” and there’s nothing wrong with that. The same can be said for Toyota Motor Company and Ford Motor Company, the two automakers that will fight GM for primacy in the North American market. Each of the three will hover around 16- to 18-percent market share in the coming decade, assuming GM doesn’t give way to upstarts like, well, Hyundai-Kia.
The story of those two automakers, which have been producing cars only for the past 35 or 40 years, offer a good lesson for GM. Hyundai picked up Kia during the Asian financial crisis of a decade ago and set lofty goals for itself. On my third visit to South Korea, to drive the Hyundai Tucson in spring of ’04, the Hyundai-Kia combo was the ninth-largest automaker in the world, quickly moving in on the No. 8 spot. Its goal back then was to be among the top five by the end of the decade.
Henderson (pictured above with Company Chairman Edward E. Whitacre, Jr.) has said that he’s not concerned about his automaker’s size. Still, if he takes care of customers as promised, GM should remain the world’s second-largest automaker, if it doesn’t retake the lead. (The difference between first- and second-place probably depends on whether GM can hold on to control of Opel.)
Being South Korean (like being Japanese, or like most Western European countries), Hyundai-Kia enjoys a much easier relationship with its government and with other local companies than any U.S. automaker has. If you buy what Bob Lutz (who has just pulled a more-effective Brett Favre by signing on with Henderson’s GM) said in another of my recent posts, President Obama’s automotive task force could lead to the best automaker-government relations that the Detroit Three have enjoyed in half a century.
While Hyundai-Kia’s market share leveled off in 2007, long before the global financial crisis hit everybody, it is the world’s fifth-largest automaker, behind Toyota, GM, Volkswagen AG and Ford Motor Company. It has a solid foothold in North America, especially with Hyundai, and has made some inroads in Europe, even if “brand consideration” and conquest sales remain relatively low. Kia has spiffed up the lower end of its product lineup, first with the Scion/Cube-fighting Soul and now with the new Civic-fighting Forte/Forte Koup.
Many early ’00s models under the new Hyundai-Kia combo were badge-engineered. They’d do Chevy-Pontiac-Olds-Buick proud. There’s more separation, now, and while the automaker’s management uses the same kind of marketspeak as all the other automakers to define the brands, to me, it’s Kia vs. Honda and Scion; Hyundai vs. Toyota and Lexus. When the 2012 Kia Amanti replacement launches, it will probably be a smaller, sportier sedan on the Hyundai Genesis sedan platform.
What has this got to do with GM? First, as I mentioned above, aggressive Hyundai-Kia will be taking market share from somebody in the North American market. The South Koreans are targeting successful Japanese automakers, true. If GM isn’t effective in making customers number one, it won’t even be in the game for the Toyota-Hyundai/Honda-Kia fight. It will be the ultimate loser.
Henderson has made it clear Chevrolet is New GM’s Big Dog, one of those statements that would seem all too obvious from any company other than GM. The new Camaro, off to a successful launch, so far, is proof GM doesn’t need Pontiac. Chevy needs some mainstream successes, though, to complement its growing scuderia of “halo” cars, Corvette, Camaro and next year, Volt. Malibu is a start, but it hasn’t moved up the sales charts to challenge the Toyota Camry/Honda Accord the way Ford Fusion is. Good as it is, the Malibu, new for ’08, will soon need a moderate refresh, or it will lose sales to an all-new ’11 Hyundai Sonata.
The ’11 Chevy Cruze needs to be a better car than the European model Paul Horrell reviewed. With its new, fuel-efficient 1.4-liter turbo gas direct injection four, it has a chance. The Buick version should be a few thousand dollars more costly, probably based on the ’10 Opel Astra that Horrell just reviewed.
I agree with Editor-In-Chief MacKenzie’s recent post that Chevy probably doesn’t need a new Impala. The Ford Taurus moved up a size when Alan Mulally revived the name to replace the Five Hundred. With the new, more luxurious ’10 Taurus, GM’s direct competitor is the ’10 Buick LaCrosse, which has a base price in the same general range as the popular Taurus trim level. If you want to make the four core brands distinctive, Fritz, reconsider the need for a new Impala. Yes, it’s still a very popular car, but most of its buyers would migrate to the Malibu.
I’ll say it one more time: if you need future full-size models, rear-drive remains the way to go (and the way to distinguish fullsize cars from large-midsize FWD models like the Malibu and LaCrosse). Hyundai-Kia has figured out that a lineup of sub-luxury vehicles should be mostly FWD for the mainstream, with some affordable, but special RWD halo models.
The Holden-based Zeta platform is too heavy without using expensive high-strength steel, but high-strength steel may be the way to go to maintain RWD for a small, but significant segment.
As GM, Ford and Chrysler have discovered, reviving RWD is costlier than updating platforms. A few posts ago, I wrote about why GM’s Kappa platform failed in the shadow of the Mazda Miata’s success. To expand on the points I tried to make in that post; while Old GM was quick at identifying such mistakes and removing them from the market, New GM must identify such mistakes, but understand that in the case of cars like the Kappas, it had a good basic premise. New GM should keep what’s worthwhile from that platform and develop a new, small RWD platform. A next-generation Camaro, which should be smaller even than the Genesis coupe, depends on it.
Source : blogs.motortrend.com/6530866/editorial/the-new-gm-the-next-hyundai-kia/index.html